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C&J Energy Services, Ltd. Message Board

  • puntazeza puntazeza Aug 29, 2012 2:46 AM Flag

    Tangible $182 M (pbv=6)

    I read several pumping posts about cjes but the pumpers do not mention that CJES already trade with a huge premium vs its peers .

    CJES has tangible assets as low as $182 M as of Q2 2012 while the market cap is as high as 1,1 BILLION $.

    This tangible value can go even lower any time as CJES has calculated a GOODWILL as high as 200 M$. This GOODWILL can result in a sizeable write down any time.

    In addition CJES has negligible cash for its financing needs. They have less than 10 M $. So how soon will they dilute ?

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    • daniel_holly Aug 29, 2012 2:55 PM Flag


    • Here we go again with TBV. Do these dorks even realize it is the company who determines these values? They do not go and get appraisals that are third party certified. CJES has historically carried their assets at BELOW market value. When they build a new fleet, they assign values that are less than their build costs. That will affect the balance sheet.

      Book value means zero when the company determines what the value is for their assets. What matters is how much CASH those assets generate, whether they are worth $1 or $1 billion on the balance sheet.

      We went through this exercise months ago comparing PTEN to CJES. PTEN trades at or below reported book value, yet their revenue per horse power for their frac equipment is a fraction of that of CJES. What would you rather own?

      PTEN with a high reported asset value on their balance sheet and low cash generated per asset?
      CJES with low reported asset value on their balance sheet and high cash generated per asset?

      No brainer.

      Take that stupid BV talk and as Duke suggested, go get yourself a financial advisor who knows next to nothing, but at least it is more than you.

    • Here we go again with the PBV comments. Did you read in their 10-K that they build their own equipment vs. competitors that buy it. So when C&J puts the equipment on their books its done at a 20-30% valuation discount to peers since they don't have to pay margin to the OEM manufacturer. Also they have a revolving line of credit that lets them borrow when they need additional capital, so they don't need extra cash sitting around not earning anything on their balance sheet.

      In your analysis did you also see that they have higher margins than any of their peers? Doesn't that suggest to you that mgmt knows what its doing, also demonstrated with cash mgmt in using extra cash to pay down higher interest rate debt vs. letting it sit on balance sheet earning nothing. Come along for the long haul my friend, you'll be rewarded.

    • If that is how you #$%$ companies for investment purposes, you might want to hire a financial advisor instead.

    • They have finance facilities,good growth prospects.Your analysis ignores the future.

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